Structural Reforms in East Asia The Key to Sustaining Global Recovery and Advancing Regional Free Trade
Julius Caesar Parrenas, PhD
Senior Advisory Fellow, Institute for International Monetary Affairs (IIMA)1
posted from: http://www.iima.or.jp/pdf/newsletter2010/NLNo_37_e.pdf
The recent G20 and APEC meetings in Seoul and Yokohama underscored the importance of structural reforms. While G20 leaders struggled over the way forward to achieve sustained global economic recovery, APEC leaders went ahead to launch work toward a Free Trade Area of the Asia-Pacific (FTAAP), possibly through the expansion of the Trans-Pacific Partnership (TPP). Embedded in the G20 and APEC leaders’ statements are references to a key issue that will influence the success of current efforts to sustain global recovery and advance free trade.
Annexed to the G20 statement is a document entitled the “Seoul Development Consensus for Shared Growth,” which laid out the framework for future work on “infrastructure, private investment and job creation, human resource development, trade, financial inclusion, growth with resilience, food security, domestic resource mobilization and knowledge-sharing.” The APEC statement referred to a strategy for achieving high-quality growth that is balanced, inclusive, sustainable, innovative and secure, described in detail in a separate document entitled “The APEC Leaders’ Growth Strategy.”
At the heart of this growth strategy is a renewed push for greater balance between domestic and external demand within economies, which is in turn key to addressing huge trade imbalances that have significantly contributed both to the current malaise afflicting the global economy and growing frictions over trade-related issues. This growth strategy hinges on structural reforms to address deep-seated problems that have emerged in the course of one of the longest periods of strong economic performance the world has ever seen. Read more…